How to Stay Financially Safe While Traveling

When Jamie Fox of Brooklyn, N.Y., traveled to Europe for the first time in 2005, her mom was a nervous wreck. To help alleviate her concerns, Fox promised to call her as soon as she landed at Heathrow Airport in London. “When I landed I noted the pickpocket signs everywhere and chuckled to myself,” Fox said. “I’m [originally] from Philadelphia, so I was pretty sure I could handle myself in London.”

After stopping at the first pay phone she saw, Fox put her wallet on top of it and called her mom. “I must have turned around for a split second, and when I turned back, it wasn’t there,” she said. Luckily, Fox still had her passport on her, but she had little else. “My license, my ATM and credit cards, any cash I had on me, gone,” she said. Friends helped Fox out with cash, and the next day she went to the American embassy and called her mom again. “She practically had a heart attack when her boss told her the American embassy was on the phone,” Fox said. After getting over her shock, Fox’s mom was able to access her bank account and wire her daughter money so she would be set for the rest of her trip.

Preparing for travel—especially internationally—often includes much more than figuring out what to pack. When it comes to staying financially safe while on vacation, there are many factors to consider. How much money and how to bring it (be it cash, cards, traveler’s checks or some combination of all of the above), along with how to safely store it are just the basics.

How to prepare your finances for travel

In order to make smart money decisions when it comes to travel, you’ll need to start before you even leave home. Some things you might want to consider before heading out the door include:

Taking care of your bills

Before determining what to do with money while you’re traveling, take some time to ensure any bills at home will be covered while you’re gone. “I set up automatic payment of my bills so that I don’t incur late fees while I’m gone,” said Lee Huffman, travel expert at BaldThoughts.com. “Most of these bills arrive electronically, so I could manually pay them, but I'm usually so focused on learning about new cultures or chilling at the beach that I don’t want to worry about them.”

Calling your credit card company

Most banks have pretty solid identity theft safeguards in place these days, so if you don’t warn yours that you’ll be spending money in a city or country far from your home, you could be in trouble. In fact, failing to do so could result in your cards being locked, said Barry Choi, a personal finance and travel expert. While you’re dealing with your credit cards, it doesn’t hurt to pack two different ones from two different institutions. When Joseph Pano of Western Australia was pick-pocketed while traveling in Rome, he found he had no access to money once he had reported his card stolen and his accounts at that institution were frozen. “So now I always have two cards, and I leave one in the hotel room safe,” he said.

Having a plan for cash

It’s always a good idea to have at least a little bit of local currency before you head to a new country, though Christen Brandt, co-founder of the nonprofit She’s the First, suggests having more on hand for emergencies. “I have a pretty good rate for pulling funds from the ATM internationally, and I used to rely on this for cash I needed while traveling,” she said. But after a 2015 trip to Sierra Leone left her without access to a working ATM for days at a time she implemented a new travel rule: “Order cash in advance or bring cash to exchange, always.”

To get the best exchange rate, Huffman suggests inquiring with your bank at home about buying the currency you need before traveling. “Just keep in mind that it may take them a few days to get it,” he said, “so don’t ask the day before your flight.” You also shouldn’t rely on exchanges at the airport, because “their exchange rates are horrible and some charge excessive fees,” he added.

Scanning your important documents

In case your wallet and/or passport is ever stolen, it will be important to have identification information available to help you obtain new copies or manage your accounts. “I scan my ID, passport and credit card information and store them in secure online storage in case my wallet is ever stolen,” Huffman said. “This makes it easier to cancel those credit cards and get new IDs from the U.S. Consulate.”

Doing some research

Doing a little bit of research before a trip can help in a myriad of ways. For example, learning how public transportation works can save you from spending a small fortune on cab rides while researching the best practices for safe traveling wherever you might be visiting can help you avoid any uncertain—and potentially harmful—situations, says Choi.

How to stay safe while exploring

If you’ve prepared properly for your trip, hopefully, you’ll be ready to explore a new area safely, armed with an appropriate amount of money. Still, even the most prepared person needs to be cautious while out and about in unfamiliar territory. Some additional things to consider include:

Avoiding theft

As Fox found out quickly on her trip to London, even the savviest of travelers can be outsmarted by thieves. One possible solution to that particular problem is choosing travel-friendly outfits. “I use clothing designed for travel, like Bluffworks, that have hidden and zippered compartments that make it more difficult for pickpockets to steal your valuables,” Huffman said. He also suggests looking into easily transportable safes or lockable carrying cases to store your valuables when you’re not in your hotel.

Scattering your money

Besides researching any dangerous areas for tourists to avoid and understanding what some of the common scams are in the area where you’ll be traveling, Choi suggests keeping your money in separate areas when you’re out and about. “Keep some money in your wallet and some in your bag,” he suggested. And don’t carry all of your money on you at once, either. “The same thing applies to your credit cards,” he added. “Keep them separate, and keep one in your hotel room.”

Avoiding currency exchange markups

The easiest way to avoid exchange markups is to use a credit card that doesn’t charge foreign exchange fees, said Choi. If you’re already in the country without a good credit card, though, Huffman suggests relying on no-fee ATM cards to withdraw cash or using local banks to exchange U.S. dollars for local currency. “Generally speaking, if you can get cash somewhere with a markup of 2.5% or less, you’re getting a great deal,” Choi added. “This would apply to banks and foreign exchange offices.”

Planning ahead

Huffman says he keeps all of the receipts from a trip in one zippered pocket of his backpack. This allows him to easily add up how much he spent during the trip and to verify that a vendor didn’t overcharge once fees show up on his cards.

How to unpack your finances

After you’ve returned home from a trip—hopefully without any particularly alarming financial anecdotes—there are still a few things to do to make sure your finances are safe.

Check your bank accounts

It’s a good idea to go over your bank accounts as soon as you arrive home to check for any inaccurate purchases. If you’ve kept your receipts, it should be easy to compare the purchases on your cards to what you actually bought. “Also confirm that the hotel charges match up to your reservation amount,” Huffman said. He recently compared a weekend hotel stay charge against the reservation to find that he was charged more than 60% higher upon checkout than what he originally booked for.

Change your PIN

Choi suggests playing it safe after a trip by changing the PIN on all of your credit and debit cards. “By doing this, thieves won’t be able to use your cards, even if they cloned them,” he said.

Traveling is a wonderful experience that broadens our horizons and teaches us new things, but when tourists encounter money problems on a trip, the entire vacation can turn sour very quickly. A little forethought beforehand, and some caution during, mean you can stay focused on your experiences, not your finances.

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